Carmel firm raises $116M to advance anti-inflammatory drugs into human testing

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Sudo Biosciences, a three-year-old Carmel biotech, said Wednesday it has landed $116 million to advance two lead drug candidates into human testing next year.

The amount is one of the largest in recent years for an Indiana-based science startup, a signal that investors are attracted by its work on a class of drugs to treat autoimmune and inflammatory diseases.

The company, founded in 2020, is developing so-called “TYK2 inhibitors,” or drugs that have an effect on an enzyme in the immune system called tyrosine kinase 2 that is linked to a wide range of immune-mediated inflammatory conditions. The inhibitors block the function of the enzyme.

“The TYK2 inhibitors have really established themselves as the next major class of anti- inflammatory therapeutics over the last really a year or two,” Sudo CEO Scott Byrd told IBJ.

The company has about 11 employees around the U.S., including two in Carmel. It uses a contract research organization in India to handle much of its research services.

The Series B funding will be used to advance two investigational candidates into the clinic next year. One is an oral medication designed to treat relapsing and progressive forms of multiple sclerosis as well as neurodegenerative conditions such as Alzheimer’s disease and amyotrophic lateral sclerosis, also known as Lou Gehrig’s disease. The second is a topical medication for psoriasis and other immune-mediated dermatologic diseases.

Byrd said the funding would help fund the company for more than three years while the pipeline of experimental drugs is being tested.

The class of drugs has been in the headlines in recent years as promising new treatments for a wide variety of inflammatory diseases.

The U.S. Food and Drug Administration approved the first TYK2 inhibitor just last fall. The drug, called Sotyktu, is manufactured by New Jersey-based Bristol Myers Squibb to treat moderate-to-sever plaque psoriasis.

A few months later, Japanese drugmaker Takeda acquired a TYK2 inhibitor, still in mid-stage development for multiple disease areas, from Boston-based Nimbus Therapeutics for $4 billion.

“And so there’s those two programs, and a number of others that are already in later stage clinical trials in development, that have shown to be quite effective in a wide range of autoimmune disorders like psoriasis, psoriatic arthritis, lupus, and they’re generally oral medications that work to regulate the immune system and inflammatory signaling,” Byrd told IBJ.

He added: “So it’s been a pretty cool, pretty crazy period for the space.”

The company has raised a total of $157 million funding since its founding in 2020, including $37 million in Series A financing it announced last year.

Sudo said the new financing round was co-led by Enavate Sciences and TPG (through its TPG Life Sciences Innovations and The Rise Fund units), with participation from Sanofi Ventures, Surveyor Capital, Monograph Capital, and Eventide Asset Management, along with existing investors Frazier Life Sciences and Velosity Capital.

Sudo’s investors say they were attracted by the young company’s science, management team and clinical potential of the pipeline.

“Severe neurologic diseases such as progressive forms of MS, Alzheimer’s and ALS have limited treatment options, and we believe Sudo’s CNS program has the potential to address these unmet needs,” said Dr. Edd Fleming, executive vice president at Enavate Sciences.

“We are excited to partner with the Sudo team to unlock the potential therapeutic applications for TYK2 inhibition in neuroinflammation and autoimmune diseases,” said Dr. Shinichiro Fuse, business unit partner with TPG Life Sciences Innovations.

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